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US high yield may be less stretched than you think
US high yield may be less stretched than you think
Chart Room: Time to be ‘semi-cautious’
The rising cycle of global semiconductor stocks has entered its second half, where an easy “buy everything” strategy is no longer appropriate.
Buildings that go green: Making an impact while still making alpha
Buildings that go green: Making an impact while still making alpha
Get real: 2024 and the need for income
For the first time in years, the interest available on cash deposits is tempting. However, parking money in ultra-defensive options comes with its own risks.
Lower rates won’t ground money markets
Interest rates are expected to drop this year. But the solid and secure returns that have drawn investors to money markets will not evaporate quite as quickly.
Chart Room: Solid foundations support stable outlook for German real estate
Solid foundations support stable outlook for German real estate
Chart Room: Cash, the once and future king
After a flood of capital into cash investments this year a look at forward interest rates suggests cash as king could reign for a while.
Chart Room: Putting the high back into high yield
The era of ultra-low coupons in the European high yield bond market is coming to an end, but higher financing costs also means elevated risk for businesses
Chart Room: Credit markets focus again on fundamentals
Fidelity's model shows factors associated with credit fundamentals and valuations have contributed more than sentiment to investment returns since the pandemic
Fundamentals: When boring banking is better
Fundamentals: When boring banking is better
Why equity investors are rediscovering Japan
Global investors under-allocated to Japanese stocks risk missing out on big improvements in corporate earnings yields and capital returns.
China + 1 = ASEAN: A winning formula
A pandemic, a war and geopolitical tensions have caused global firms to rethink their supply chains, and many are eyeing the ASEAN region.
How China aims to unlock more value from state firms
In a new reform push, China’s policymakers are nudging state-owned companies to boost shareholder returns and capital efficiency.
Proxy plays on China’s consumer rebound are all the rage in Paris
Luxury companies have been among the biggest beneficiaries of China’s bounce and are delivering investors exposure without putting money in Chinese companies.
Japan’s stock market reform gathers steam
The Tokyo Stock Exchange is taking steps in the right direction on some long overdue reforms, but more still needs to be done.
Chart Room: Earnings, not valuations, will carry China’s rebounding markets forward
Improving corporate earnings are likely to take over from cheap valuations as the main driver in the next stage of the Chinese stock market's rebound.
Readying for a real estate recovery
Readying for a real estate recovery
Fundamentals: Building Paris every week
Retrofitting is the answer to slashing real estate's huge carbon bill, says analyst Cian O'Sullivan in our latest Fundamentals episode.
A new golden age for China’s investment sector
China’s investment and wealth management industry is embracing a golden age. The onshore markets will remain an attractive long-term investment destination.
New world, new playbook
We move into 2023 in a changed world, and the opportunities and challenges will be different for investors going forward.
US midterms and a history of stock market gains
The division of power after US midterm elections has led to calmer stock markets and positive investment returns. 2023 may yet prove more of an exception.
Bonds are back in town
For over a decade, one of the main cards in investors’ pack - solid and steadily yielding government bonds - has been off the table. That era has ended.
Chart Room: US housing dip may hit sentiment hard
US real estate was at the centre of the financial crash in 2008. The US housing sector is back in focus again as unaffordability returns to peaks from 2005-7
Chart Room: As the energy crisis bites, occupiers see value in green buildings
Chart Room: As the energy crisis bites, occupiers see value in green buildings
Chart Room: Leveraged loan returns bounce back, but for how long?
Chart Room: Leveraged loan returns bounce back, but for how long?
Asia’s shifting growth model
Market leadership continues to evolve across Asia-Pacific, with potential inflation making some markets look more resilient than others.
Coming of age
Inflation is back, the ‘new normal’ for office use is still unclear and the low-carbon transition is changing the relationship between landlord and tenant.
On course for a soft landing
At the moment, a soft landing looks more likely for equities in 2022, but a number of risks could drag the market into something more unpleasant.
Asia’s shifting growth model
Market leadership continues to evolve across Asia-Pacific, with potential inflation making some markets look more resilient than others.
Coming of age
Inflation is back, the ‘new normal’ for office use is still unclear and the low-carbon transition is changing the relationship between landlord and tenant.
On course for a soft landing
At the moment, a soft landing looks more likely for equities in 2022, but a number of risks could drag the market into something more unpleasant.
Chart Room: Digging into China’s GDP growth
A sharp decline in excavator utilisation reflects China’s property-and-infrastructure-induced slowdown, but it also boosts the case for strong policy response.
Asia eyes a tantrum-free taper this time
A faster-than-expected tapering by the Federal Reserve remains a risk for Asian bond markets, but investors have been reassured by the latest policy signals.
Chart Room: Bond markets tempt FAIT amid prospects for a steeper US yield curve
The market sees risks that the Fed will not accommodate a large inflation overshoot, but we think the yield curve may have flattened too far.
Chart Room: Gimme shelter (from inflation)
Shelter inflation continues to hold the key for forecasting inflation pressure in the US.
Chart Room: What Japan’s digital transformation means for markets
After years as relative laggards, Japanese companies are diving headfirst into DX, or digital transformation, and investors should take notice.
Chart Room: The crisis and opportunity in recycling single-use plastics
Production of single-use plastics is forecast to continue rising for the next decade-plus, and investment opportunities will depend greatly on recycling.
Chart Room: Stronger for longer for China’s renminbi?
Expectations for further renminbi appreciation have risen, but we think short-term gains could be capped from here.
Credit risk at China’s SOEs in focus amid Huarong saga
China’s bond and equity markets have been rattled by concerns that state-owned enterprises could face greater default risk.
Chart Room: China’s EV industry is charged for growth
The combination of falling battery costs and rising adoption rates means China's EV industry is charged for growth.
Chart Room: An uneven supercycle for commodities?
Most commodity prices have been strong this year, spurring talk of a potential supercycle. But the returns could be more dispersed from here.
Chart Room: The rapid rise of digital payments in India
The technological transformation of India’s economy has accelerated in recent years, as can clearly be seen in the accelerating shift to digital transactions.
Chart Room: Why dividends make sense in an inflationary environment
History shows how dividend-focused investment strategies can provide sustainable income in a reflationary environment.
Chart Room: China has fewer reasons to be hawkish
China's short-end rates remain low despite earlier expectations for monetary tightening.
Why India’s ‘fallen angel’ risk is rising
India’s ballooning debt levels amid a structural growth slowdown have raised the risks of an imminent downgrade by credit ratings agencies.
Chart Room: Equity volatility eases as Treasury yields rise
The VIX has fallen below a key technical level, suggesting a new wave of investor optimism.
Chart Room: EM outperformance could be sustained, if commodities are a guide
This week’s Chart Room shows the historical correlation of EM equities with commodities, which suggests that the breakout could be sustained.
Investors should tread carefully around warehouses
Investor interest in logistics property has jumped but the surge in demand has left some parts of the market looking mispriced.
Chart Room: Retail investors pile into the fastest growing stocks
Retail investors' market participation is extreme not only in volume, but also concentration.
Chart Room: A Goldilocks spot for inflation-linked bonds
We see a sweet spot in inflation-linked bonds with maturities ranging from 1 year to 10 years.
Four real estate trends to watch as economies reopen
After a tumultuous 2020, we believe there are four main themes that will determine real estate trends for this year and the decade to come.
Chart Room: Keep an eye on housing rents when tracking inflation
Some key considerations make us more constructive on US rents for the year ahead, particularly soaring home purchase prices.
Chart Room: Risk-on and on, with caveats
Caution and careful positioning are important from here, based on the latest readings from Fidelity’s risk aversion indicator.
What’s ahead for China’s markets in the Year of the Ox
Investors keen to see whether China’s bull market can keep charging ahead in the lunar Year of the Ox will be focused on recovery and monetary policy.
Chart Room: Emerging markets and the reopening trade
Emerging EMEA (Europe, Middle East and Africa) and Latin American stocks are particularly well positioned to reap the benefits of reopening.
Chart Room: The return of the value super-cycle?
In this week’s Chart Room, we look at both sides of the long-standing debate between value and growth investment styles, as seen from both Europe and China.
Chart Room: After the Gold Rush
Is it time to take profits in gold?
Chart Room: A liquidity tide for the record books
2020 brought us new high-water marks in the US for both money supply growth and the personal savings rate.
Chart Room: Chinese stocks, playing catchup, finally retrace 2015 highs
But the rally in China’s main onshore index still lags its US and global counterparts.
Chart Room: Weakening dollar gives emerging markets a shot in the arm
Emerging markets may be helped further along by the weaker outlook for the US dollar.
Unlocking India’s structural opportunities: 10 charts
Reforms and new infrastructure paving the way for manufacturing investment and employment will be key to unlocking India’s next stage of development.
European high yield: The curious case of the defaults that didn’t happen
At the height of the March crash, defaults looked set to soar. The reality turned out to be very different.
Chart Room: The clear link between ESG and returns
How have stocks that scored high for Environmental, Social and Governance (ESG) factors held up amid the Covid-19 fallout?
China takes aim at trash
A massive nationwide effort is underway to improve China's waste management systems.
Chart Room: Some sectors may be set for a margin squeeze
The latest reading from our monthly analyst survey shows which companies are struggling with inflationary pressure but also weaker pricing power.
Chart Room: Correlations boil and bubble 🎃 and may spell toil and trouble 🦇
In this follow-up special Halloween edition of Chart Room, we look at how correlations are casting a spell over markets.
Chart Room: Government debt climbs to spooky heights
In this special Halloween edition Chart Room (part 1 of 2), we look at the frightening levels of government debt around the world.
Chart Room: Why growth still has room to grow in China equities
The valuation premium for China growth stocks versus value stocks hit a new all-time high, lifted by the consumer, tech and healthcare sectors.
Chart room: European cyclicals vulnerable if manufacturing data moderates
Any moderation in the growth of new manufacturing orders could make cyclicals vulnerable to a de-rating.
Chart Room: Is disinflation lurking around the corner?
In a bullish signal, the bond market’s short-term expectations for US inflation are back near pre-crisis levels. But are investors being overly optimistic?
Chart Room: Why some tech valuations may be lower than you think
A closer look at longer-term valuations reveals some surprising trends in tech.
Chart Room: Emerging market currencies lag on inflation risks
EM countries are using some of the same monetary and fiscal measures as developed markets. But this could add to rising inflation and currency weakness.
Chart Room: China’s Covid rebound puts the ‘V’ in investment
Fixed asset investment (FAI) in China has recovered to its pre-Covid levels of growth, with infrastructure and property driving the nation’s broader economy.
Why India could be the next breeding ground for tech unicorns
The Silicon Valley giants are shifting their attention to India as the next big growth market.
GEARs: Bursting through the ceiling?
Fidelity International’s GEAR (Gauges of Economic Activity in Real Time) activity indicators continue to rebound strongly.
Crisis accelerates trends in European real estate
The implications of the Covid-19 pandemic for European real estate investors
Chart Room: Robots on the rise in a post-Covid world
We think factory automation will accelerate further in a post-Covid world, as machines don’t get sick and can work continuously excluding maintenance.
Chart Room: Asian equities diverge, creating opportunities
The difference in performance between equity markets in East Asia and South Asia (India, ASEAN nations) is the largest in nearly 15 years.
GEARs: China roars while the global economy snores
Our Gauges of Economic Activity in Real time (GEARs), a proxy for three-month annualised growth, improved this month but remain in extreme hibernation.
Chart room: Despite a recent rally, high yield bonds still look cheap
For US high yield, valuations look historically cheap on a relative basis - especially when compared to equities.
Chart room: Another false dawn for value stocks?
Over the past decade, previous periods of value outperformance have been short-lived. Will this time be different?
Valuations come to the fore in Hong Kong
Hong Kong equity valuations have been torpedoed by a slew of negative events, we see opportunities here for long-term investors.
Japanification in 12 charts
Many western economies are mirroring Japan’s experience over the past 30 years.These 12 charts show how some of the key trends are playing out.
Chart Room: QE expectations vs. reality, market moves
Market expectations of future asset purchases by the Fed have an even greater influence than the purchases themselves.
Chart Room: Mobility data shows most economies are rebounding slowly
Economic activity is being determined by virus response rather than slower-moving traditional industrial cycles. We need to adjust our toolkits accordingly.
Is the US turning Japanese?
A higher post-coronavirus savings rate in the US risks pushing the country into a low growth spiral similar to that which first ensnared Japan 30 years ago.
The end of the journey to the West: Chinese tech firms come home
The tides of global capital markets have turned for Chinese tech firms. Instead of US listings, they are starting to find greater China more compelling.
China again primes growth with infrastructure investment
With exports expected to slump and consumption still struggling to fully recover, China is turning to a familiar playbook - infrastructure spending.
Chart Room: Beware the narrowing market
Equity market performance is now at its narrowest since the 2008 Financial Crisis, with the rally riding on a dwindling number of large-cap growth stocks.
Chart Room: Mind the valuations
After recent rebounds in stocks and bonds, we take a quick look at valuations and how they stack up against history.
How India’s economy is navigating Covid-19
As the world begins to come out of lockdowns and economies normalise, India can offer bright spots for emerging market investors.
Chart Room: What in the world is going on with gold?
The correlation between gold and equities has increased to an 18-month high, calling into question the metal’s usual benefit as a porfolio diversifier.
Oil tankers gush profits as global storage space overflows
Oil tankers are earning windfall profits - but how long can this situation last?
Chart Room: More policy easing supports China bonds
This week’s Chart Room shows how ample liquidity is helping China’s onshore bond markets navigate around global volatility.
A shelter from the storm, for now: China’s bond market set to open further
When global fixed income investors scrambled for cover last month, China’s onshore bond market was a rare haven with low volatility and no liquidity crunch.
Chart room: Beauty of big tech stocks is in the eye of the beholder
Our latest Chart Room takes a comparative look at the long run up in the Nasdaq 100 index.
Fidelity CIOs: Dispersion increases as demand effects filter through
Investors become more selective as demand shock hits oil price and other sectors.
How to think about dividend cuts
A spate of dividend reductions or postponements has raised concerns among investors globally. But not all dividend cuts are created equal.
Chart Room: Fidelity analysts expect longer disruptions from Covid-19
Chart Room: Fidelity analysts expect longer disruptions from Covid-19
Delayed demand making its return to China’s property market
New home sales are recovering faster than expected in China. This has big implications for domestic demand and the macroeconomic outlook.
Strong underpinnings to Asia’s investment grade bond market
Asia’s investment grade bond market looks attractive as we continue working through the Covid-19 outbreak, and global coordinated stimulus take effect.
Analysing the shift from bad to less bad
The stimulus to fight the economic shutdown in the wake of the coronavirus is second only to the Marshall Plan following the Second World War.
A cautious consumer rebound takes hold in China
Chinese consumers are offering a ray of hope in the economic wreckage from the Covid-19 coronavirus
European IG: With volatility comes opportunity, but discipline is key
Recent price dislocations means the long run return potential of European investment grade bonds is positive, but prepare for continued volatility
China gets back to business
How fast and how fully activity recovers in China will have huge implications for one of the world’s key economic growth engines.
As gold’s surge draws wider interest, miners shine too
Gold's lustre is also rubbing off on the companies that dig it up from the ground.
FLI: Consumer confidence holds up amid broad-based slowdown
For the first time in two years the Fidelity Leading Indicator cycle tracker signals both below-trend growth and deceleration.
A supply and demand shock for oil markets
Expectations of a demand shock due to the Covid-19 coronavirus collided with an anticipated supply surge after OPEC+ had a major fallout over production cuts.
Outbreak deepens China’s e-commerce push
While the coronavirus threatens to put a dent in China’s overall growth, pockets of the online economy are booming.
When the playbook stops working
Why did markets wait so long to sell off in the wake of the Covid-19 coronavirus outbreak?
Market volatility spikes on coronavirus impact
How should investors respond to the uncertainty caused by the coronavirus outbreak, and the volatility it may create?
Fidelity Leading Indicator signals slowing global growth as coronavirus impact looms
The economic impact of the novel coronavirus outbreak is only just beginning to be captured by the latest FLI reading.
China’s financial support targets second-order fallout from coronavirus
China’s healthcare workers have been struggling to contain the spread of coronavirus. Now, policymakers are grappling with the second-order financial effects.
Fidelity Leading Indicator: Still strong but approaching the limit
The Fidelity Leading Indicator's acceleration is circling back towards zero after a period of strong improvement.
Cool Heads: Romain Boscher and Marty Dropkin on earnings and consumer strength
Romain Boscher and Marty Dropkin discuss discuss the rebound in earnings and the divergence between manufacturing and consumer strength.
Hunting for yield in frontier markets: Egypt
When smaller frontier markets mature into benchmark names, early investors can earn attractive returns in these relatively niche, often overlooked places.
Volatility is a double-edged sword that investors can’t live without
A better understanding of volatility and its role in portfolios can help investors to position themselves for any turbulence ahead.
Despite macro challenges, pockets of resilience in Chinese corporate earnings
Some bright spots in recent earnings reports suggest interesting opportunities
Decades of loose policy have left us in uncharted territory
Driven by loose monetary and fiscal policies, leverage is enormous and market dislocations numerous - anything could happen from here.
Gold still has space to shine on
We see more upside for gold, thanks to a potent cocktail of falling interest rates, rising long term inflation expectations and heightening recession concerns.
Central banks keep the show on the road, for now
Equity and bond markets don’t agree on what we should expect for the second half of the year. How should investors position in light of these mixed signals?
EM outlook: Easier conditions, tougher growth
After a challenging end to last year, the start of 2019 has brought some tentative stability to emerging markets. But it is too early to issue the all-clear.
Uncertainty is now at an attractive discount in the UK and elsewhere
Predictability has been at a premium in recent years, but we feel the discount now offered to take on uncertainty offers a long-run opportunity.
A Goldilocks moment for China’s monetary policy, but watch for more easing and bond index inclusion
Two events are driving the outlook for China fixed income- easing monetary conditions and the expected inclusion of Chinese bonds in benchmark indexes.
Chinese stocks brace for increased capital flows
MSCI is quadrupling the weighting of Chinese shares in its benchmark indexes, highlighting the country's increasing centrality in global finance.
Macro slowdown clashes with market optimism
The disconnect between economic fundamentals and markets is unlikely to be sustainable in the short term.
As market sells off, stay vigilant but calm
In light of the recent sell-off, it is important to watch the current apparent risks closely while focusing on stock selection rather than macro forecasting.
Risk-off for the US but not for everywhere else
The right response for investors to signs of the US market losing momentum is to hunt for value in areas which have already been aggressively sold down.
Tencent as bellwether
Tencent’s apparent setbacks look to be short term and not structural. A closer look reveals a wide moat in online gaming and social messaging.
What to watch at the end of the cycle
The world seems full of questions at the moment about the end of the cycle, the effect of quantitative tightening, valuations and the trade war.
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